Business

Businesses focus on cost cutting to boost profit

New research predicts businesses will try to stay profitable by cutting back on spending rather than expanding their operations in the first quarter of this year.

The survey by credit information and debt collecting firm Dun and Bradstreet shows businesses are expecting sales and inventory levels to be sharply lower than in the previous quarter.

At the same time those surveyed expect profits to rise due to cost cutting.

Dun and Bradstreet spokeswoman Danielle Woods says businesses are becoming smarter with the way they use their cash.

"There's certainly a sense out there that cost management really needs to come to the fore," she said.

"Things like getting accounts in the door and making sure that they get those invoices out and then they chase those debtors, because a bill is not a bill until its actually finally been paid and that money is through the door."

The focus on cost cutting means it is likely to be a difficult start to the year for job seekers.